Tens of thousands of people underpaid ESA by thousands of pounds each due to DWP error, says National Audit Office
Tens of thousands of people underpaid ESA by thousands of pounds each due to DWP error, says NAO DWP 'failed to get a proper grip on the problem' for several years, and says that not everyone will be repaid all the money they missed out on
Following an investigation into errors made by the DWP when it transferred claimants from incapacity benefit to ESA - only awarding contributory ESA when there may have also been entitlement to income-related ESA - the NAO has today published a report highlighting that it took several years for the DWP to realise the significance of its errors.
Key findings include -
As a result of the DWP's errors, an estimated 70,000 people have been underpaid benefit amounting to £340 million pounds with an average underpayment of around £5,000. Following a review of a sample of 1,000 cases, the NAO estimates that around 45,000 claimants entitled to the enhanced disability premium only may be owed around £2,500, and that approximately 20,000 claimants who are entitled to the severe disability premium may be owed around £11,500 each - with a small number potentially owed around £20,000.
However, the DWP has said that it will only pay arrears as far back as 21 October 2014 following the Upper Tribunal judgment in CE/4181/2013 (reported as  AACR 14). As a result, an additional £100 million to £150 million of underpayments will not be repaid.
Publishing the report, head of the NAO Amyas Morse said -
'The facts of this case are that tens of thousands of people, most of whom have severely limiting disabilities and illnesses, have been underpaid by thousands of pounds each, while the Department for several years failed to get a proper grip on the problem. The Department has now committed to fixing this error by April 2019, but not everyone will be repaid all the money they have missed out on.'
In response, Chair of the Work and Pensions Committee, Frank Field commented -
'This is a damning report. The Department is quick to act in cases of overpayment, quick to sanction claimants for any breach of its rules – but when the shoe is on the other foot, has shown it will take years to recognise and get to grips with its own mistakes.
This must have caused even more hardship for people many of whom have struggled through an assessment process that we heard from thousands of accounts is, for some, gruelling and humiliating, and riddled with errors and wrong decisions."
It is welcome that the Department is finally moving to right its mistakes, if slowly, but this is a shocking story of a group of people serially failed by DWP over a period of years.'
For more information see Investigation into errors in Employment and Support Allowance from the NAO website.
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